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How to Collect a Debt Internationally

by JC Rawley

Overview

Collecting a debt internationally can be a difficult proposition or a regular business transaction. It depends on whether you have taken the time before the sale to find out if the customer is likely to be trouble. By ordering a credit report on him or by searching to see if he has been sued by other suppliers you can better assess the risk. If you have not done the due diligence on the customer then it could be more work than necessary to collect from them. .

Step 1

Mail a statement to the customer and follow up with a telephone call. Collecting money is just like selling. If you do not ask, you do not get. By sending the statement and following up with a telephone call you are asking the customer to pay. If he is in a different time zone than your company, you could be leaving a message that may be returned when you are not in your office. But the point is to ask. You may be surprised to find that the customer pays you without further effort or contact on your part.
Step 2

Email the customer with a request for payment. If the telephone contact has no response, you may have to escalate the matter from the accounts payable person to the person who ordered the goods or perhaps even the president of the company. The Internet is useful for finding out information on how to contact the customer because many companies (even those in other countries) have websites. You can search for the company and use the "Contact" tab on its site to send a message or find out an email roster.
Step 3

Search the Internet for a local third party to collect the debt in the customer's country. If you are several time zones and many thousands of miles away from the customer, he may think you will eventually give up and stop calling. To escalate the matter, you need to bring some local pressure to the situation. A third-party collection agent or company can call the customer to effect payment much more cost effectively than you can and will charge a percentage of the funds recovered as a fee. Make sure you look for a reputable one or one that is recommended or has a relationship with your domestic third-party collection agent or company.
Step 4

Contact a collection lawyer in the customer's country to begin a collection lawsuit. This should be a last resort; it might be expensive, but you still have rights as a creditor. You can also get a judgment in your country and try to have it transferred or recognized by the customer's country or jurisdiction, but that is not always possible or cheap.

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Computer with Internet connection
Computer with Internet connection
Investigate before selling overseas. Some countries have credit bureaus that offer reports on their companies, and some credit bureaus in the United States can find reports on companies in foreign countries, though they can be expensive.
Investigate before selling overseas.
Some countries have credit bureaus that offer reports on their companies, and some credit bureaus in the United States can find reports on companies in foreign countries, though they can be expensive.
This article is not legal advice. Please seek out a qualified lawyer if you have legal questions.
This article is not legal advice.
Please seek out a qualified lawyer if you have legal questions.